The Layman’s Guide to Understanding Crypto PFP.

PUBLISHED Aug 31, 2022, 11:02:28 PM        SHARE

imgTobi Opeyemi Amure

Since the introduction of web2 and the iteration of the social web, digital identity has developed into a mainstream paradigm for communicating the personalities, interests, and ideals of users all over the world. Our digital identities have been defined by a variety of factors, but they are most commonly described using what is known as a PFP.

What is PFP in Crypto?

Texting and social media advancements have given PFP many names. It was originally called "picture for proof," but it is now more commonly known as "picture for proof" or "profile picture." In any case, it represents the display of a crypto-related image for online posting, primarily on social media. The use of crypto-related PFP dates back to when Bitcoin became more acceptable, and the introduction of new concepts such as new cryptocurrencies like Ethereum, and new concepts such as crypto trading and smart contract applications. It was widely used by crypto enthusiasts, crypto companies, exchanges, and some businesses that accepted cryptocurrency as payment.

The era of institutional and cryptocurrency-centered PFP has passed, and the concept is now dominated by profile pictures for non-fungible tokens, a web3 concept that exploded onto the main stage in 2021.

What is a PFP NFT?

A PFP NFT is a non-fungible token that takes the form of a picture representing art – digital animals, people, or any other digital character — and may be shown as avatars on social media or any online application. Following the advent of Cryptopunks NFT, a project containing 10,000 distinct pixelated characters, the trend was introduced in 2021. At the time, members of the project who owned the digital asset uploaded a "device-saved version" of the NFT to their social media profiles, including Twitter, Facebook, Instagram, Discord, Whatsapp, etc. Bored Apes Yacht Club (BAYC), a collection of 10,000 unique ape-themed characters, debuted in April 2021 and quickly gained popularity, with images of Apes from the collection spreading across the media and being used as profile pictures.

The culture has since grown with the expansion of the NFT space from just the Ethereum blockchain to other chains like Solana, Cardano, and others, and there are NFT PFPs everywhere that feature thousands of NFT projects, from popular projects like Meebits, Cool Cats NFT, Doodles, World of Women, Mfer, DeGods, OkayBears, and many other upcoming and less popular NFT projects as well. These PFPs represent NFTs that can be worth substantial amounts of money, ranging from thousands to millions of dollars, and thus easily attract both new and existing NFT users. Furthermore, it serves as an asset display showcase as well as a marketing strategy to increase the visibility of the NFT project on display.

Other Forms of NFT

PFP NFT is just one class of the industry and NFTs can come in the form of anything that can be digitally recreated. Here are some of the most popular forms of NFTs you should also know about.

  • Photography NFT

  • Music NFT

  • Game items NFT

  • Videos and GIF NFT

  • Metaverse NFT

  • Domain name NFT

    Difference between NFT PFP and NFT value

    An interesting fact is that not everyone who has a profile picture with an NFT actually owns that digital asset or even an NFT at all. A non-fungible token is a one-of-a-kind digital asset that is stored on the blockchain and can be listed, bought, or sold using a cryptocurrency wallet. This means that the actual NFT with monetary value is stored in the same way that cryptocurrencies such as Bitcoin and Ethereum are, and NFT profile pictures seen on the internet and social media are only a representation of that asset that can be saved in device storage as an image. You can easily save an NFT image from the web or social media and use it as your profile picture if you think about it. This does not imply that you own the NFT or that the PFP has any monetary value.

  1. This principle applies to the plethora of NFT profile pictures circulating on social media, and different people use them for different reasons, such as;
  2. They truly own that particular NFT and would like to display it as well as connect with other members of their collection and NFT users in general.
  3. They sold the NFT but kept it as their PFP, either because they have an attachment to it or because the PFP is what they are known for in their immediate social media community.
  4. They want to be perceived as wealthy and capable of affording the asset.
  5. They want to appear trendy and involved in the NFT community.
  6. They are looking for whitelist spots for an upcoming project.
  7. They are enthusiastic about the project but cannot afford any of the items in the collection.

For whatever reason people choose to use NFTs as profile pictures, the trend has significantly contributed to the popularization and growth of the industry, as well as the onboarding of influencers, investors, celebrities, and brands to the NFT scene driving up the sector's value and positioning it among the relevant web3 sectors in the coming years, alongside concepts such as Decentralized Finance (DeFi), and Metaverse.

The Next Phase of PFP NFT

The next stage of this trend will be marked by interoperability innovations that will enable the integration of crypto wallets with social media accounts, allowing the assets present in the wallet to be displayed and seen by social media users. Earlier this year, Twitter made it possible to link crypto wallets to the application, choose an NFT and upload it as a profile picture. This service is, however, only available to users of Twitter Blue, a paid subscription of the app that gives subscribers access to premium features. In addition, Meta launched NFT display options on Facebook in June, where users will be able to create custom NFT posts with a 'Digital Collectible' tag, and profiles will have a new, dedicated NFT section to exhibit non-fungible assets.

Efforts being made by big social media names like Meta and Twitter are an indicator of the sector's potential and are critical in driving more traffic and value to the NFT space, and in addition to traditional companies that are integrating NFT options, social media dApps like Mirror, Coinvise, Nafter, and Mask Network also have NFT options that are worth exploring.

Read More: Hackers have stolen $1.4 billion via Crypto Bridges in 2022 alone

Bottom Line

As bleak as this year appears to be for the NFT industry in terms of total sales and floor prices, certain projects are thriving and expanding, communities remain tightly knit, projects are introducing new utilities for their members, and companies are paying millions to purchase digital assets and invest in the sector. One thing is certain: the NFT hype is far from dead, and we may see another breakout season sooner than expected.

Storing your cryptocurrencies in online wallets, exchanges and software wallets exposes you to risks of being hacked. Consider storing them in a hardware wallet today

I/we have no positions in any asset mentioned, and no plans to initiate any positions for the next 7 days

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